Midler Corporation operates in an industry that has a high rate of bad debts and uses the allowance method to account for its bad debt expenses. Before any year-adjustment on 7/31/2014, Midler's accountant compiled a list of account receivables, showing customer names, invoices amounts, invoice dates, and due dates as below

Days Account Late	Estimated Bad Debt Percentage	Count of Late Payments	Sum of Late Payments	Estimated Bad Debts
1~19 Days	20%
20-39 Days	40%
40-59 Days	60%
60~79 Days	80%
80-99 Days	90%
100-119 Days	96%
120-139 Days	98%
140+ Days	100%
Total

Midler Corporation creates a table to determine the number and amount of total late payments. Use CountIFS, SumIFS, and other appropriate Excel functions to complete the table above. * What is the appropriate balance for Allowance for Doubtful Accounts at year end (i.e., 7/31/2014)? * Assume that the Allowance for Doubtful Accounts had a credit balance of $40,000 before adjustments, what is the journal entry to recognize bad debt expense? * Assume that the Allowance for Doubtful Accounts had a debit balance of $40,000 before adjustments, what is the journal entry to recognize bad debt expense? * Normally the Allowance for Doubtful Account has a credit balance before year-end adjustments. Explain why Midler has a debit balance.

A, 1 Customer InvoiceAmount InvoiceDate Due Date 1232014 3232014 ESI2014 23/2014 12014 21712014 3192014 512014 E1512014 3232014 216/2014 2202014 42014 EI6I2014 7282014 2012014 512912014 E1212014 1182013 2512014 4127/2014 112912013 3112014 T16/2014 11282013 2122014 12014 3182014 1212014 129I2014 12014 32912014 E12014 227/2014 32712014 3012014 4114/2014 4412014 1011012013 42512014 4/ 2014 31442014 4/2014 412/2014 114/2013 912014 E112014 E142014 416/2014 3232014 426/2014 42212014 101412013 113012013 419/2014 922014 E302014 417/2014 172014 1212014 $343.00 $1939.00 $4.378.00 $873.00 r Lemieux, Niana LOusInS, Jeniffer 9 Moe, Christi $245.00 $311.00 Rapp, Jeni 11 Whitman, Donita ane $6,476.00 $2,006.00 14 Brant, Elouise lb Larsen, Naila $4,850.00 $2,995.00 $6,260.00 17Brackett, Curtis 19 ar 12512013 E2712014 4302014 412712014 E142014 E/3012014 1221201,3 /10/2014 713/2014 E212014 1712014 5 192014 E/152014 E/182014 12014 4212014 E142014 71242014 71282014 E7/2014 7162014 4212014 22 Whited, Un 24 Tolbert, Yoshiko 26 Shank, Sebastian $3,496.00 ! ersten $2,486.00 $4.292.00 $6,497.00 $4,280.00 $3,920,00 27 Saldana, Ven ana, venita 29 Schubert, Gwenn ge 31 Adam, Elmer $777.00 34 Pack, Bradly 35 Hardison, Ka 36 Zook, Corrinne 37 Pimentel, Crist $3452.00 $1,290.00 $1,070.00 39 Buffington, Fonda 40 Loftin, Burton $6,383.00 $3,869,00 $5.022.00 Tr 43 Shah, Celsa